How to use skills tests to address internal skills gaps

The world is evolving at a faster rate than ever before, which means skill demand is increasing and the talent gap is widening.

An internal skills gap could leave an estimated 2.4 million positions unfilled between 2018 to 2028 due to rapid technological progression and ever-changing needs.^[1]

But by proactively identifying and addressing skills gaps, you can prevent them from ever becoming a detriment to your organization.

Skills testing is the most accurate way to identify skills gaps, giving you real actionable data on skills your company lacks, so you can predict and fill potential future positions.

These assessments are also useful for verifying new capability. Testing new candidates or validating employee training efforts with these assessments ensures accuracy and consistency.

Let’s talk about the importance of pinpointing your company’s skills gaps and the indispensable role skills testing plays in it.

What is a skills gap?
The positive impact of identifying and addressing skills gaps
How skills tests help organizations address skills gaps
Use skills tests to round out and boost your company’s skill sets
Sources

What is a skills gap?

A skills gap occurs when an individual or team doesn’t have every skill needed to successfully complete their work.

The exact definition differs for individual and team skills gaps:

Individual skills gap: The employee lacks every skill needed to independently perform their tasks
Team-wide / company-wide skills gap: The team or company lacks the skills needed to compete in the market

If your team needs a skill, you can’t ignore that need. So most often skills gaps are compensated for by, for example, giving all the Flutter coding tasks to one developer.

But this strategy can be problematic, and sometimes it’s impossible if that worker already has a full workload.

An individual skills gap can usually be shored up by delegating tasks to other teammates; however, that can culminate in many issues over time (more on that later).

A company-wide skills gap is much harder to address, and can result in the entire organization lagging behind.

For example, a software development company has a few programmers fluent in a specific coding language, but not enough to launch a large-scale project.

Their competitors, on the other hand, have an entire team skilled in this language and are already hard at work on such a project.

These gaps are not an uncommon problem. One study showed that 87% of security leaders are facing an internal skills gap, and they represent the single most significant barrier to strategy execution for 43% of these leaders.^[2]

If a skills gap is not addressed, over time, it can evolve from a mere nuisance into a major detriment.

What are the real implications of ignoring these gaps?

When your people lack essential skills, you risk missed deadlines, struggling workers, and unbalanced workloads. We all know “that one employee” who can do everything, and so carries the world on their shoulders.

And that “one employee” can only keep it up for so long before they burn out.

The positive impact of identifying and addressing skills gaps

Ignored skills gaps can cause countless headaches, including overworked employees and strained deadlines.

These factors get much worse, too. They can snowball into burnout, quiet quitting, increased costs, and damaged customer relationships.

Advantages of identifying and addressing skills gaps

But let’s consider the other side of the coin. Identifying and addressing these skills gaps carries many advantages:

Reduces cost-to-hire
Helps you keep up with the competition
Discovers untapped talent
Facilitates a proactive strategy

And these lead to some amazing outcomes.

Reduces cost-to-hire

Taking a proactive approach to your company’s skills gaps can reduce your recruiting costs in two major ways:

You can hire someone to fill the gap who provides the exact skills you’re lacking (because you know exactly what you’re looking for)
You can simply upskill the current employee instead of hiring anyone at all (because you know the kind of skill level your current team has)

Let’s begin with that first point.

Too often in hiring, you spend hours reviewing and interviewing dozens of candidates because your criteria weren’t specific enough to narrow down the perfect applicants.
This isn’t ideal, is it? And you aren’t alone in thinking that. According to TestGorilla’s State of Skills-Based Hiring 2022 report, more than 1,500 hiring managers agreed that it’s ideal to only review two to ten candidates for a role.

In an ideal world, how many applicants would you like to review for any given role? — Source

Hiring managers across the board would prefer to review only a handful of candidates, so it’s essential to have very specific criteria for what you need in a candidate.

Reviewing your skill gaps helps you define this criteria and know exactly what you’re lacking.

As for the second point, by upskilling a current employee you can avoid the hiring process completely.

Identifying missing skills in an employee and initiating a training program for them is much more affordable than the thousands of dollars it can cost to hire a brand-new worker.

Helps you keep up with the competition

Regular skills gap analyses are pivotal in ensuring you keep up with the competition, and helping your organization stay relevant and healthy.

It's crucial for your organization to hold regular skills gap analysis

The world moves forward quickly when it comes to talents and technology, so it’s crucial for your organization to hold a regular skills gap analysis.

For example, it pays to upskill current employees or hire new ones proficient in a new coding language if other software companies are adopting it to produce new products.

Identifying the strengths and weaknesses of your team and rounding out their skills assists company growth, helps you plan hiring initiatives, and increases your organization’s overall performance.

Discovers untapped talent

A skills gap analysis discovers more than weaknesses – you might discover some untapped strengths in your current employees that you weren’t aware of.

Perhaps one of your programmers is proficient in not only languages like Python and Java, but also Norwegian?

This means that employees can extend their professional reach, taking on different responsibilities and growing their overall skill set.

What does this mean for you?

A happier, more talented employee with a fleshed-out skill set who’s more likely to be retained by your organization.

A study by Lever found that 31% of employees would take a pay cut in order to take on a new role. And a further 61% would start searching for a new job if their company wouldn’t enable them to start a new role.

For more on this topic, check out our blog post on internal mobility.

Facilitates a proactive strategy

A skills gap analysis is also a crucial part of proactive recruitment – in fact, it’s the first phase.

What’s proactive recruitment? It’s the process of building a talent pool of candidates before you need them, enabling easier, faster recruitment.

A skills gap analysis can reveal potential future positions within your company, so you can build a stellar talent pool of possible candidates that fit your exact criteria for those roles.

Proactive recruitment carries many benefits:

Better candidate experience
Less pressure on hiring managers
Fewer mistakes and bad hires
Higher quality candidates

Assessing current skills gaps enables you to see where your organization sits currently, so you can use that data to more accurately develop future plans.

How to use skills tests to identify skills gaps

There are many ways to conduct a skills gap analysis, including:

SWOT analysis: This stands for Strengths, Weaknesses, Opportunities, and Threats. A SWOT analysis helps you list out what your company is doing right and what it needs improvement on.
360 evaluation: This tactic involves gathering feedback on employees from peers, leaders, management, and customers.
External evaluation: This involves hiring an external evaluator to assess your skills gaps, which frees up more of your time and keeps things objective.

But the most accurate way to identify and address skills gaps is through data-driven skills testing.

Skills tests aren’t just for hiring candidates. They’re also indispensable in discovering strengths and weaknesses in current employees.

Ways that skills testing helps to fill skills gaps

Skills testing helps fill skills gaps in many ways:

Spotting overall skills gaps, so organizations know where to focus
Identifying individual skills gaps, so trainers know where to focus
Tracking progress at both levels
Certifying skills internally

Skills tests objectively assess technical skills, soft skills, and language proficiency. Many other methods don’t offer the accuracy and transparency that skills tests bring to a skills gap analysis.

Here’s a quick step-by-step on how to conduct a skills gap analysis with skills testing:

Talk with leaders and identify business goals
Determine short- and long-term objectives
Identify the skills you need to achieve these objectives
Conduct both individual skills gaps analyses and team-wide analyses using skill tests
Create a plan to address gaps
Measure skills with skills tests at regular intervals to verify progress

Create specific, role-relevant assessments for roles and use them to evaluate where a worker stands in their skill set.

Here’s an example of various programming tests for an analyst programmer:

After the employee is finished, assess the results.

The results are displayed through percentages and time taken to complete, making it easy to objectively measure the score.

Let’s say this employee scored perfectly on four out of five of these tests, but hit just below the mark on their C# Debugging test.

You now have a clear, discovered individual skills gap.

If you were doing a team-wide assessment, you’d just have each member of the team take assessments, review the results as a whole, and see where you’re lacking overall.

These assessments are also useful for finding soft skills gaps. Perhaps your skill tests show that your team is lacking good critical thinkers.

Now you can search specifically for great critical thinking in your next hire.

After the skills gap analysis is complete, you need to build a plan to address the discovered skills gaps. Plans can include training employees, providing mentorship, hiring new workers, and outsourcing work to contractors.

As you begin training and mentorship initiatives, we recommend assessing and verifying new skills along the way with skills testing.

How skills tests help organizations address skills gaps

Ways skill testing can be used to plug the gaps

Once you’ve discovered and identified your company’s skills gaps, you can use skills testing to plug the gaps in a variety of ways:

Introduce a culture of skills-based hiring to recruit new employees both internally and externally
Assess contractor skills to temporarily fill skills gaps
Facilitate measuring and validating efforts during and after training

Let’s look at these more closely.

Introduce a culture of skills-based hiring

Recruiting and hiring are the primary use of skills testing, and filling skills gaps is a great first step to adopting skills-based hiring.

Skills-based hiring focuses on real talent, reduces bias, and enables you to find the ideal candidate for the role. It’s the future of hiring, and the sooner organizations adopt it, the better.

Here are a few of the top benefits of skills-based hiring:

Build a better, fairer candidate experience and attract more top talent
Find the best people for open roles, reducing bias and widening talent pools
Easily fill skills gaps with laser precision, increasing the odds of hiring the ideal candidate the first time

It’s where modern minds are headed, so using skills-based hiring practices lets you keep up with the competition while also giving candidates the hiring process they prefer.

Skills based hiring gives candidates the hiring process they prefer

Data from TestGorilla’s State of Skills-Based Hiring Report supports this statement:

76% of employers today use skills-based hiring to identify talent
54% of candidates prefer a hiring process using skills tests
80% of businesses had a company goal of increasing diversity
91% of employers saw an increase in workplace diversity

Skills-based hiring is also one of the most effective and accurate methods for hiring new talent. The above report also found that with skills-based hiring:

92.7% of companies reduced the number of mis-hires
91.4% reduced the total time-to-hire
89.8% reduced the overall cost-to-hire

Erica Reckamp, a job search consultant, is a huge proponent of skills-based hiring.

In this post, Erica talks about an awful experience she had hiring a candidate based on work history and a stellar resume. Soon after, she switched to a skills-based hiring process, and found the most skilled employee she’s ever hired.

This sort of horror story isn’t rare when your recruiting process relies heavily on resumes.

To read our collection of them, check out our 5 stories from resume recruiting hell.

Test contractors and freelancers stepping in to fill a gap

Although contractors and freelancers can be a quick, efficient solution to recruitment, it’s sometimes difficult to determine their true skill level.

A contractor may not always have traditional work experience, and getting hold of references can also pose potential issues.

But this doesn’t mean you should give up on using external collaborators.

Skills testing enables you to accurately assess a contractor’s capability, personality, and culture add potential.

Contingent workers and freelancers are a great temporary solution to skills gaps as you organize and consider your options. They’re a quick way to account for growth or keep up with trends and competitors.

Freelancers are also quick, so being able to hire them with confidence enables you to address skills gaps almost immediately.

Even if the worker is just a solution for a few months, skills tests ensure they have the right skills to successfully bridge the gap until your permanent solution is ready.

Skills tests are also great for assessing a contingent worker for a trial role with plans to make the position (and the employee) permanent.

Read more about this in our entire guide on hiring contingent workers.

Implement training and development, then validate new skills through skills testing

Hiring new talent is great, but every hiring manager knows the benefits of upskilling their current workforce.

Professional development increases an employee’s satisfaction, retention, and performance. According to the a 2021 survey by Monster, 45% of employees would be more likely to stay with a company if it invested in their professional development.

So what about the skills gaps that can be solved by upskilling current employees?

Skills tests are great for discovering skills gaps, but you can take it a step further and use them to measure skill progress as well.

Regular skill assessments enable HR professionals to monitor upskilling programs and back their decisions with objective, solid data.

This enables you to prove that the training is working.

And if the training isn’t taking hold? Then you can take action and adjust the plan.

Skill assessments can be used to upskill and verify the skill level of both individuals or teams, depending on the results of your skills gap analysis and current plan.

Another benefit to using skills tests for both the analysis and during upskilling and training is consistency. Maintaining consistency between methods ensures a more solid process.

For example, the same tests that showed you that you needed more marketing skills will be used to assess your marketers as they learn.

Use skills tests to round out and boost your company’s skill sets

Skills tests are one of the most accurate, efficient ways to identify and address skills gaps within your organization.

They help you discover untapped talent, stay competitive in the market, and enable you to develop a proactive recruitment strategy.

Skills test effectively fill gaps keep your company thriving

From identifying the talent gaps in a skills gap analysis to hiring new talent, skills tests enable you to effectively fill these gaps and keep your company thriving.

For an entire in-depth guide on the subject, read our blog post on conducting a skills gap analysis.